Gary:
Each year we budget for a specific amount from central as well estimated
tuition and university fees. The current year (2007-2008) was budgeted based on
an estimated enrollment of 1700 - we came in a little under this. Gary uses
more than just a headcount when determining the budget. The numbers are down,
not significantly down, the mix of of students isn't too bad—much of our
number drop was from PSEO students, and we only generate around 50% of tuition
amount from those students.

Pete
Wyckoff asked a question: even normal students have a discount rate, what we're
giving them in financial aid that is directly costing us, what is the typical
student (not PSEO) bring in? Jacquie responded that the tuition discount rate
at Morris is around 29%.

The
tuition revenues for this year will be down slightly, maybe $150,000 short of
what was budgeted, but Gary also set up a tuition reserve for $150,000 so we
should be close.

Retention
rates have been going up and so are graduation rates (not quite as high as we'd
like). Jacquie observed that a discussion needs to take place to decide how
conservatively we want to plan for next year's enrollment.

In
addition to our budget for the year we got money allocated through the COMPACT
process, a process whereby central administration funds requests for new initiatives
and plans (listed in Gary’s handout). The money from this COMPACT process has
helped us stay in the black. Some of that money was counted in the 06-07 budget
but wasn't spent last year. When you take these funds into account, along with
the fact that we will need to spend the funds for their allocated purposes, we face
a real budget shortfall for 2007-2008 of between $300 and $400 thousand
dollars.

In
addition, what we've been doing for several years is moving money from unspent
accounts in order to balance the accounts at the end or the year. There is the
concern that these unspent accounts won't always be available for flexibility.

For
instance, there is probably a good chance that we're looking at a more serious
problem than $300 to $400 thousand for the current year because of the
following. The Master Planning process has been initiated, and that will cost
approximately $100,000. Also, there is an agreement with the high school to
redo the track, estimated costs: another $250,000. Lowell feels that we're
looking at half a million dollars for these and other similar expenses, which
means that we could be looking at a deficit of $900,000 rather than $300-$400
thousand.

We lost
our flexibility/our cushion in 2005-2006 when we overspent by over 1. 6 million
dollars-- this is the hole that we need to dig ourselves out of. Gary feels we
need to get out of the habit of spending money in reserve/restricted accounts.
Initially, however, we need to work on the $800-$900 thousand deficit.

Tuition
Funding: this year we are dealing with the financial impact of lowering
tuition by $1,000 rather than raising it by 4.25%. The net reduction seems to
be about $1.3M. Central administration gave us $970,200 recurring money in our
budget to cover the reduction. We also were allocated additional funds for
our American Indian tuition waivers (now fully funded for the first time in
recent years) for $600,000.

As the
central administration sees it, we have been given $1,570,000 additional
tuition support, so it looks like we have more than we need. However, the
money to cover the tuition reduction and to fully fund the American Indian
tuition waiver should be considered separately, so it seems that they still owe
us if the tuition reduction is to be revenue neutral. Jacquie and Gary will
discuss this issue with central administration, and hope to secure funds to partly
offset our current year deficit.

LeAnn
requested another hour of meeting time to discuss the budget further.

Tom
McRoberts will be pushed off for a future week, and next week's meeting will be
to discuss the budget.

Discussion
next week:

SE &
E spreadsheets

Staffing

Gary
will bring summaries of what we can spend, what we have out there allocated.